Comprehensive Automobile Liability Insurance

What Does Comprehensive Automobile Liability Insurance Mean?

Comprehensive automobile liability insurance is a type of coverage that can be purchased as part of your auto insurance policy. It covers incidents involving your vehicle that are caused by unpredictable elements or events other than collisions. This includes incidents that occur whether your car is in motion or at rest. The coverage helps you repair or replace any damages to your vehicle that are covered by the policy. While this is optional car insurance, if you have an auto loan, you may be required to purchase comprehensive automobile liability insurance to meet the terms of your agreement with the finance company.

Insuranceopedia Explains Comprehensive Automobile Liability Insurance

Comprehensive auto liability insurance is a coverage introduced by insurers to expand the scope of automobile insurance beyond just collision-related incidents. It is considered an innovation designed to meet the growing demand for broader protection. The difference between the two matters when you’re building out your policy, so it helps to see how comprehensive car insurance compares to collision insurance side by side before deciding what to add.

Comprehensive auto insurance covers a wide range of incidents that may cause damage to a vehicle, including fire, floods, theft, vandalism, and even damage caused by animals.

When obtaining a quote for comprehensive coverage, it is necessary to select a deductible amount. The chosen deductible affects the cost of the coverage. Before you pick a number, it’s worth thinking through whether raising your auto insurance deductible actually saves you enough on premiums to justify the higher out-of-pocket cost at claim time. Comprehensive insurance covers repair costs as long as they do not exceed the vehicle’s original purchase price, minus depreciation. That payout cap is also one reason some drivers question whether collision and comprehensive insurance is worth keeping on an old car, since premiums can add up to more than what the insurer would ever pay out after a total loss.